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A question of respect

Norway celebrated 40 years as an oil-producing nation in 2011, and could look back on gratifying quantum leaps in safety over these decades. But PSA director general Magne Ognedal notes that some worrying basic issues remain in the Norwegian petroleum sector.

The global community used 2011 to lick its wounds after the Deepwater Horizon disaster the year before – ask critical questions, probe reasons and responsibilities, and discuss the need for a new organisation of international safety. That process is far from over, and Mr Ognedal has identified some key issues which stand out at the start of a new year.

“First and foremost, I would ask – yet again – why the Gulf of Mexico disaster continues to be categorised as an environmental discharge?

“It perplexes and astonishes me that an accident with a tragic outcome for many people is usually discussed as a pollution issue – not least in Norway.

“Perhaps it’s appropriate to ask how Norway would have handled a petroleum incident which left 11 dead and many permanently injured? I believe – and hope – that the answer is selfevident.

“Let’s remember that safety and concern for people must always be the top priority. And an enterprise management which safeguards personnel is also the best protection for the environment.”

Mr Ognedal has several observations to make in the wake of the Deepwater Horizon disaster and the major incident on the Montara field off Australia during 2009.

“Have the international companies, both those directly involved and others, subsequently been too concerned to centralise their overall management systems and work routines?

“Is it the case now that management is concentrated to a greater extent at company head offices, without operations being tailored to the established rules and principles of the countries in which they operate?”

He says that the PSA has seen a number of worrying signals of this. These include information received over the past year which suggests that genuine employee participation and influence have been reduced in some companies.

“Such codetermination is a regulatory requirement in Norway and an overall expectation in Norwegian society –
expressed most recently in the working life White Paper published last autumn. This must be respected.

“We’ve otherwise seen examples of the requirement to apply best practice for operations in Norway being overridden
by central guidance from company head offices.

“That’s also unacceptable. Every company which operates in Norway undertakes to comply with national requirements and expectations.” 

At home, disquiet about the “tripartite” collaboration between companies, unions and government in the country’s petroleum sector is another source of concern for Mr Ognedal.

“Some people perceive a negative trend in this area,” he notes.
“Such worries must be listened to and taken seriously. It’s very important that cooperation between the three central groupings functions well.”

Pointing out that all sides must contribute to a good climate, he says that a tripartite collaboration demands loyalty to existing petroleum industry fora. These include the Safety Forum, the Regulatory Forum and Working Together for Safety.

“Participants must be expected to use the meetings of these bodies to raise key concerns and questions. Their mandate for taking part is to express views on behalf of the organisation they represent.

“In return, we must be able to require that views are debated and listened to by the other sides involved. However, one party can’t always fulfil the expectations of the others, and that must also be respected.

“Nor can the PSA intervene in all circumstances. Certain conditions must be settled between the employers and the employees.”

But Mr Ognedal emphasises that a fundamental principle of the tripartite collaboration is that decisions taken in its arenas are respected.

“We can’t have issues already settled in a tripartite forum being rehashed in the parties’ own arenas. Over time, such conditions will clearly dilute cooperation.”

With Norwegian petroleum production past its 40th anniversary, Mr Ognedal can look back on gratifying progress. He has personally worked in the industry for almost the entire period, and has been at the safety helm – first in the Norwegian Petroleum Directorate (NPD) and then at the PSA – for 32 years.

“The changes have been huge,” he emphasises. “ Conditions in the 1970s are barely comparable with those which prevail today.

“In the early years, safety was an add-on to other concerns. New facilities were designed, and then assessed for how safe they were.

“That’s fundamentally different from the present position, where safety considerations are incorporated from the moment the first line is pencilled in.”

“Before the 1985 reform, regulation of the Norwegian petroleum sector was complex,” Mr Ognedal admits.

“The change established clear lines of responsibility between the various regulators, and between them and the industry.”

People began to think in completely different ways and to develop new regulatory/supervisory methods, he notes. And – not least – the internal control principle was established in Norway.

“I well remember some episodes from my first years as safety director at the NPD. On one occasion, for instance, I asked an oil company management who they felt had overall responsibility for the safety of their operations – themselves or the government.

“At the same time, I requested some thoughts on how the responsible party should discharge that responsibility. I wanted an answer in writing – and got one after two years.”

When he tried the same exercise with a different company, Mr Ognedal recalls with a smile, it took them five years to come up with a response.

“That provides a good illustration of the present maturity and understanding of roles we have in Norway’s petroleum industry. No company management would need time to answer such a simple and basic question today.

“Both the industry and the government have done a fantastic job over these four decades. We’ve created a grown-up sector.”

“I’d take our follow-up of mobile units as an example of progress over the most recent decade of our 40-year petroleum history,” Mr Ognedal continues.

“We’ve now allocated responsibilities clearly between vessel owners and drilling contractors, and made an  acknowledgement of compliance [AoC] necessary for working on the NCS.

“These moves have brought us some important steps forward. The drilling contractors have accepted their responsibility and helped to improve safety in the Norwegian petroleum industry.”

He points out that Norway’s offshore safety regime is highly respected in the global arena, with training in and information on the national model in demand across much of the world.

“We’ve also experienced great interest from the USA since Deepwater Horizon. This recognises and confirms that we’ve come up with some bright ideas in Norway during our oil history.”